UPDATE: Citigroup Upgrades Telephone & Data Systems to Buy, Raises PT

In a report published Monday, Citigroup upgraded its rating on Telephone & Data Systems

from Neutral to Buy, and raised its price target from $25.00 to $27.00. Citigroup noted, “TDS announced the sale of some of its Midwest PCS markets to Sprint representing roughly 32% of its operating footprint (by population) in an effort to monetize assets that weren't contributing a meaningful amount of OIBDA to US Cellular. We are upgrading TDS to a Buy rating based on: 1) the wireless divestiture is the first evidence in years, in our view, that TDS is willing to sell wireless operating assets when faced with an increasingly difficult competitive environment; 2) the transaction price supports upside to the valuation for U.S. Cellular's remaining assets; & 3) we now believe the potential benefits from U.S. Cellular working to improve the fitness of its remaining wireless operations and to consider additional strategic options should create more value relative to the risks of further strategic inaction or investing without regards to future returns. We upwardly revise our target price for TDS to $27.” Telephone & Data Systems closed on Friday at $22.57.